Let's Dig Through A Budget!

Katy Grimes – I spoke with a man yesterday who was looking for information about his city council salaries and benefits. So I did a little digging into the beautiful southern California coastal town of Laguna Niguel, an sent him instructions on how to do his own research.

Starting with a the link to the Laguna Niguel city budget: Budget FY 2010-2011 (Large file 4 Mgs – the City of Laguna Niguel the table of contents lists where the City Council budget, expenses, stipends, and operating costs can be located (pages 16-18).

The population of Laguna Niguel 64,680, and the median income is $103,048. The part-time City Council is paid a stipend plus expenses. That was not egregious although, paying “expenses” can be cover for many bad habits.

The Laguna Niguel City Manager salary is not delineated from other staff, but I found a recent story that stated his salary is $311,463 annually.

He has an annual department budget of $947,000, and pays $71,000 for “Employee Recognition programs.” How could the City Manager possibly need $71,000 for “employee recognition programs?” Is that the new secret code for “bonuses?”

There’s another $20,000 for “recruitment” listed, but begs the question why is the City Manager trying to recruit people, and why $20,000 is needed, when Craig’s List or even the online classifieds for Orange County is a cheap and easy way to recruit.

The City Manager has $72,000 alloted for federal lobbying. I wonder who the city’s lobbyist is. What federal issues could Laguna Niguel be facing?

There is even another $6,000 allotted for “Personnel Services,” which should be covered by city manager staff under Human Resources. It would be interesting to see how that money is spent.

It looks as if the City Clerk is paid $133,000 plus another $70,000 in department benefits.

The City Clerk budget has $69,000 allotted for “elections,” and another $6,350 for “elections consultant,”  whatever that is.

The city spends $297,000 annually on legal services. I wonder what law firm the city uses… could it be the law firm of one of the council members who happens to be a lawyer?

The finance department has a $550,000 budget for salaries, $270,470 and benefits, with $17,500 listed as “special department expense,” whatever that is… sounds like a slush fund.

What’s really weird about the police chief is that all of the Laguna Niguel policing services are contracted to the Orange County Sheriff’s department through an $8.9 million contract. But, the police chief is still  paid $67,000 in salary and benefits, and is responsible for all public safety services in Laguna Niguel.

That may sound innocuous enough however, the glaring budget item is $171,000 for crossing guard services! Why would a small city spend $171,000 on “crossing guard services?” (pages 35-36)

There is even an additional $50,000 alloted to the Neighborhood Watch program.

Still listed under Public Safety, the city spends $6,000 for a one-day seminar, probably for the police chief’s travel and expenses. There is $7,000 for clothing, $18,900 for communications, and $63,500 to the Emergency Preparedness plan, but no explanation where the money goes for that plan goes.

The Animal Control funding is $339,000, and again, with no detail or explanation how the money is used.

I’m not trying to pick on beautiful Laguna Niguel, but the beach town’s budget is an excellent example of unaccountable spending, and again, has a very well-compensated City Manager.

Other southern California cities pay high as well. According to a July 27, 2010 story in the Press Enterprise, Corona’s City Manager is paid $230,256 a year, the Loma Linda City Manager is paid $175,000 a year, and Riverside’s City Manager salary is $294,525. (City Officials Highly Paid?)

The easiest way to find a city budget is to google the city name, and city council. Once inside the city website, search for “budget.”

I recommend spending time reading through each department’s expenses — that’s where you’ll find unaccounted for expenses and special funds with no real designation.

4 comments

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  1. Tim Casey
    Tim Casey 20 August, 2010, 13:40

    The following is a copy of my August 9 E-Mail response to CalWatchdog Writer Katy Grimes:

    My name is Tim Casey and I am the City Manager for the City of Laguna Niguel. Last Friday (August 6), our local newspaper reporter called and asked if I’d like to respond to your article about the Laguna Niguel City Budget (“Let’s Dig Through a Budget” – July 30). When I read your story, I wasn’t sure where to begin. There were so many factual errors, unsupported conclusions and innuendoes. Another journalist advised me to provide a factual response to each statement in your story, but to inject a little sense of humor. I’m not known for funny…but here we go.

    My salary is not $311,463; it is $234,343. That does make me a well-compensated City Manager. With 29 years as a California City Manager, my compensation is reflective of my education, experience, performance and the marketplace for public managers.

    Our City does budget $71,000 for Employee Recognition Programs, and that number does include a Bonus Pool equal to 1% of our total full-time employee salaries in accordance with our negotiated labor agreements. Those agreements authorize me to grant a bonus (not to exceed 5% of annual base salary) to City employees who demonstrate extraordinary or exceptional performance. It’s an authorization; not an entitlement. I’m pretty tight with the public’s dollar, and bonus awards are pretty few and far between. Just ask our City employees. Funds budgeted, but not spent, lapse at the end of each fiscal year.

    $20,000 for Recruitment is budgeted to advertise employment opportunities in the Orange County Register and other publications. This is the recruitment account for all City Departments. It’s also used for pre-employment physical examinations for new hires and State-mandated fingerprint/criminal background checks for employees who work with kids. We hire a lot of part-time employees as Lifeguards, Recreation Aides and Skateboard Park Attendants every year.

    As for Federal lobbying, the City has engaged two firms: Packard Government Affairs and Federal Advocates, Inc. We are pursuing federal funds for some significant street improvements near a major freeway exchange that are beyond our means to pay from solely local revenues.

    $6,000 for Personnel Services is budgeted for third-party administration of various programs like COBRA (insurance continuation for former employees at their expense) and Flexible Spending Accounts that the IRS lets employees fund with pre-tax dollars for Child Care, Health Insurance Premiums and Out-of-Pocket Health Care Expenses. We don’t have a Personnel or Human Resources Department (our Deputy City Manager wears that hat among many) so we occasionally require the services of a consultant to assist us with an unusual personnel issue or problem.

    Our City Clerk does not receive a salary of $133,000 plus another $70,000 in benefits. We don’t have a full-time City Clerk. That’s another responsibility performed by our Deputy City Manager. The figures you quote actually represent the total salaries and benefits for our Deputy City Clerk, a Receptionist/Clerk Typist and one-half of a full-time Administrative Secretary. The other half of the Secretary is accounted for in the City Manager’s Office. Pages 9-11 of our FY 10-11 City Budget set forth our Table of Organization which lists all of the City’s full-time positions and how they are allocated to each Department’s Budget.

    It’s an election year, and the City will have to pay the County of Orange an estimated $69,000 to consolidate our Municipal Election with others on the November ballot. As mentioned above, we don’t have a full-time City Clerk so we do sometimes engage the services of an election consultant (or experienced retired City Clerk) to provide additional assistance during the election season.

    As for legal services, the same City Attorney has served the City since our incorporation in 1989. He is a sole practitioner and is not affiliated with a municipal law firm. Our City Council Member who happens to be a lawyer was elected in 2006 and serves as Legal Counsel to a private brokerage and investment banking firm. There is no connection between the two.

    $17,500 for Special Department Expense is budgeted in the Finance Department for various expenditures such as bank service charges and fees and independent bank monitoring services. It also covers a $50 per meeting stipend that we pay to members of our Investment, Banking and Audit Committee, a City Council appointed group of Laguna Niguel residents with backgrounds in banking, accounting, finance and investments. The Committee meets 4-5 times per year and provides citizen oversight over the City Staff and our financial management.

    I’m not sure how you concluded that the City is paying $67,000 in salary and benefits to our Police Chief. We have a Sheriff’s Lieutenant who serves as our Chief of Police Services under our law enforcement contract with the Orange County Sheriff’s Department. His total compensation is covered under the contract. We do budget $67,000 for other City Employees who are assigned to Police Services. Those funds cover half the salary and benefits for a Management Analyst plus the cost of a part-time Administrative Intern.

    Why would our City spend $171,000 on Crossing Guard Services? There are seven public elementary schools and one middle school in Laguna Niguel. Many of our students have to walk across four-lane and six-lane highways to get to school (even more now with recent cutbacks in school bus transportation). The safety and protection of our children is a high priority in Laguna Niguel. Having groups of kids, 5 to 11 years old, cross such streets without adult supervision would not be an acceptable option in our community. The City has been providing such services since 1993 and contracts with a private firm for the provision of crossing guards.

    $50,000 is budgeted in Police Services for our Neighborhood Watch and Crime Prevention Programs. These funds cover the cost of public information and educational materials. We send a Crime Prevention Newsletter to every Laguna Niguel household 3-4 times per year with crime prevention and home security tips, new law updates, etc. Our biennial Resident Satisfaction Survey suggests that over 92% of Laguna Niguel residents prefer to receive information about the City in newsletters and other printed materials mailed to their homes.

    You listed several other items under Public Safety (i.e. One-Day Seminars, Clothing, Communications). These budget accounts cover expenses for short one-day or half-day workshops/seminars for our Public Safety personnel, uniforms and gear for our Public Safety citizen volunteers (i.e. Police Auxiliary Citizens Team) and law enforcement related telephone lines, database connections and radio system charges. The $63,500 for Emergency Preparedness covers the other half of the Management Analyst in Police Services (who also serves as the City’s Emergency Preparedness Coordinator) plus incidental disaster preparedness communications, materials and supplies expense.

    Finally, the City contracts with the neighboring City of Mission Viejo for Animal Control and Shelter Services. The estimated cost of those services for FY 10-11 is $339,000.

    I realize that this is a rather lengthy and detailed response to your article…and I guess it wasn’t very funny. The details of municipal budgeting and expenditures seldom are. But your story compelled me to respond with the dry cold facts (in nauseating detail as my wife would say – there’s my attempt at humor).

    I wish you had contacted me before you posted your story. This is the same information I would have provided you (or anyone else) over the phone if you had called. I would have been happy to discuss and clarify these items before your story was published to avoid errors and inaccuracies. I would have spent as much time as you needed. I always do.

    Tim Casey, City Manager
    City of Laguna Niguel

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  2. CalWatchdog
    CalWatchdog Author 24 August, 2010, 16:14

    I am appreciative of Mr. Casey’s detailed response. I did however, call the city of Laguna Niguel for budget information, but was transferred to a dead end, and never actually spoke to a city employee about my budget questions. It was a Friday, and I figured they were operating a lean staff.

    My purpose in using the numbers that I obtained from the budget was to show how vague the information in a published city budget is. Residents should never be left to draw conclusions about budget allocations.

    And, for a city of 64,000 residents, Mr. Casey is quite well compensated, as he acknowledges in his comment. With an annual salary of $234,448 plus health, retirement, life insurance and long term disability benefits, Mr. Casey states that he has been a City Manager for 29 years, as though the longevity justifies the high salary. In the private sector, there is such a concept as a salary cap — even with longevity.

    Laguna Niguel pays for city employees’ medical, and “full cost of employee and dependent coverage” for dental and vision, life insurance, as well as long-term disability. Laguna Niguel offers the PERS 2% at 55 plan. The City pays both the employer’s and employee’s retirement system contribution.

    These benefits add up quickly. Should an employee be required to pay his or her own, it would cost far more than $2,000 per month right out of the paycheck, and depending on the benefits chosen by the employee. For example, Laguna Niguel pays $1119.87/month for an employee and family, just for medical coverage. The link directs to a document titled City of Laguna Niguel, Full-Time Employees Benefits Summary.

    To quote Mr. Casey’s compensation as $311,000, is probably fairly accurate, when all of his benefits are included. However, I should have specified “total compensation.”

    In fact, more employees should be given an annual total compensation statement to see how much they receive in compensation, and not just in take-home pay.

    I live in Sacramento, a city of 466,000 residents – seven times the size of Laguna Niguel — and our city manager is paid $215,000, and probably has a comparable benefits package to Mr. Casey’s. Sacramento is a much larger city, and has a much larger city staff.

    In most businesses, the number of employees one has to manage, and the size of the total budget factors into compensation decisions.

    But today I found a story from last week in the Orange County Register, that read, “The ongoing scandal in the city of Bell has prompted Laguna Niguel to post the salaries of its city council members, city manager, commissions and committees online. At the city manager’s request, the Laguna Niguel City Council voted 4-0 Tuesday to post the salaries.”

    The story I wrote for the CalWatchdog blog ran on July 30, and I received Mr. Casey’s first email on August 9. Hat’s off to Mr. Casey for encouraging the city council to post salaries. Transparency in government is something many in government talk about, but rarely practice.

    -Katy Grimes

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  3. Brent D. Gardner, CLU, ChFC
    Brent D. Gardner, CLU, ChFC 27 August, 2010, 13:31

    To put Tim Casey’s salary in perspective, consider this fact: Ben Bernanke’s salary last year was $196,700.

    Reply this comment
  4. Marc Winer
    Marc Winer 17 September, 2010, 14:58

    Tim Casey has done and is doing a much better job than Ben Bernanke, and IF he wasn’t doing such a great job, the people would not have kept him on for about 20 years.

    Reply this comment

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